Strategies, Challenges, and Answers

Bad Faith Set-Up Fail!

Chau caused an auto accident that killed the opposing driver Benjamin Buenaventura.  Chau reported the accident to the Nevada affiliate of AAA.  Less than a month later, the attorney for the claimant sent a time limit policy limit demand to AAA.  To meet the demand, AAA would have to pay the entire $100,000 each person limit to Clara Buenaventura within two weeks and driver Chau would have to certify that there was no other insurance.  … [Read more...]

Nevada Allows Policyholders To Sue Certain Managing General Agents and Third-Party Administrators For Bad Faith

An agent who acts for a disclosed principal is not liable for commitments made by the agent in the principal’s behalf.  See ALI’s Restatement (Second) of Agency § 320 (1958).  In the field of insurance, managing general agents, third-party administrators and independent adjusters have regularly shielded themselves from claims of bad faith brought by policyholders’ against the insurance company for which that agent works.  But that rule of hornbook law is beginning to erode following insurance … [Read more...]

A Nevada Insurance Company Does Not Commit Bad Faith By Simply Denying A Claim

Luck was not with Jose Montes.  He was hurt in a very serious motor accident.  He was hospitalized for six weeks and spent 46 weeks at home recovering.  Lucky for Mr. Montes he had purchased an accident insurance policy through agent Bank of America from insurer National Union Fire Insurance Company.  Unlucky though because when he made claim for benefits under the policy his claim was denied.  He believed that the insurance should have paid and that the exceptions to coverage were fraudulently … [Read more...]

A Policyholder Cannot Prevail Under NRS 686A.310(f) Unless There Has Been An “Ultimate Recovery”

Hartford’s policyholder was hurt in two separate accidents, once in 2009 and then again in 2010.  She collected policy limit settlements from each tortfeasor.  She then turned to Hartford, her UIM carrier. She demanded a policy limit settlement for each accident. When the parties could not agree on the value of either claim, the policyholder sued Hartford for breach of contract, bad faith and violations of Nevada's Unfair Claims Settlement Practices Act. (UCSPA). Mueller v. Prop. and Cas. Ins. … [Read more...]

UIM Bad Faith Damages Do Not Include Those Bodily Injury Damages That Are In Excess Of Both The Liability And The UIM Policy Limits

Mr. Bartlett had a dispute with his insurance company. He disagreed with the insurance company’s valuation of his underinsured motorist case. Bartlett sued the tortfeasor and got a judgment against him that was in excess of the torfeasor’s liability limits and in excess of Bartlett’s own underinsured (UIM) motorist coverage With the judgment in hand, Bartlett filed a suit against his UIM carrier for bad faith.  Bartlett v. State Farm Mut. Auto. Ins., Case No. IP01-0510-C-HG, (D.C. Ind., Nov. … [Read more...]